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Nevada gets lead position in online gaming markets (HED)

Published 1:00pm Saturday, February 23, 2013

Las Vegas now offers it. Atlantic City will begin to offer it in days. Will Biloxi or Tunica be threatened by the lack of it? I’m talking about legal online poker.

Nevada this week became the first state in the nation to authorize interactive gaming — giving the state the jump on other destination gaming states like New Jersey and Mississippi in the competition for online poker business.

Nevada leaders said the legislation was critical to Nevada’s economy because it enable existing licensed gaming companies in their state to take the lead in making online poker available around the country, potentially giving them a competitive advantage over operators in other states where such companies are domiciled.

As noted in my column two weeks ago, Mississippi State Rep. Bobby Moak, D-Bogue Chitto, tried again in 2013 to get the Mississippi Legislature to vote on his online gaming legislation that would have put Mississippi in the lead on this initiative. Moak’s 2013 House Bill 254 met the same fate this week as did Moak’s HB 1372 did in 2012.

The Moak bills — virtually the same legislation as adopted in Nevada — died in Mississippi legislative committees both years after being double-referred.

Moak’s bill proposed to regulate, license and tax online gaming at 5 percent of gross revenues. The bill would have restricted online gaming licenses to those companies already holding land licenses to operate in the state.

When Moak introduced HB 1372 during the 2012 session, religious critics of any expansion of legal gaming of any kind in Mississippi reacted. But because the bill protected them from competition from new online-only gaming companies, many of the big casino operations supported Moak’s play. Moak is a former chairman of the House Gaming Committee and knows the industry well.

Moak’s Mississippi Lawful Internet Gaming Act was a reaction to a 2011 U.S. Justice Department ruling that held that the Interstate Wire Act of 1961 — a federal law that has complicated efforts to legalize online gaming. It was being interpreted as only outlawing sports betting. In the past, the federal Wire Act was interpreted as outlawing all forms of gambling across state lines.

Under the ruling, states can sell lottery tickets online and authorize online poker, roulette, blackjack and other casino games, as long as the actual betting takes place within a respective state’s boundaries, even if out-of-state credit cards are used to finance the gambling.

Moak argued that the legislation was necessary to allow Mississippi’s existing gaming industry to have more control of its own destiny and to allow the state to regulate what will already be taking place online with or without their approval — and to tax it. The bill — which died in committee after being double-referred to Gaming and Ways and Means — included a measure to allow the state’s existing gaming licensees to offer online games of chance that are regulated and taxed by the state, but on different terms than in the bricks and mortar casinos.

New Jersey Gov. Chris Christie vetoed online gaming legislation passed in 2011 by the New Jersey Legislature, but is expected to sign the 2013 new online gaming bill days after Nevada beat New Jersey to the political punch. Since the Justice Department ruling, seven states (California, Delaware Hawaii, Iowa, Illinois, Mississippi, and New Jersey) have entertained legislation authorizing forms of online gaming in their states. Utah has passed legislation specifically prohibiting internet gaming. Maine has altered their gaming statute in response to the Department of Justice ruling.

Mississippi lawmakers haven’t heard the last of the online gaming issue as certain competition for the state’s existing 30 commercial casinos that had gross gaming revenue of $2.25 billion in 2012. With major competitors Nevada and New Jersey now legally on board with online poker, Mississippi gaming companies will face increasing pressure to be able to offer the online games as well.

(Sid Salter is a syndicated columnist. Contact him at 601-507-8004 or sidsalter@sidsalter.com)

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